Share this content

Query re selling flat

I would like to know what is needed for a property to be a main residence from a tax viewpoint pleas

Didn't find your answer?

I’d be really grateful for any ideas about this problem please…. I did ask my own accountant but he wasn’t sure about this. I and my father each bought a flat in the same building 5 years ago but because mine is ground floor and he is a bit infirm now, we swapped over about 3 years back to make life easier for him. We have effectively been living in each other’s flats since. We are each paying council tax and bills for the flats that we live in (we had to swap council tax as I am married and don't qualify for a single discount). Eventually when we come to sell, I am concerned about incurring liability for capital gains, because effectively we won’t have been living in the properties we own. What I’m wondering is, what steps could I take to correct the problem, ideally short of having to move back physically into each other’s flats because of the hassle and difficulty involved. Is it possible to nominate our flats as our main residence (neither of us own any other properties)? Many thanks again for any help, which is much appreciated.

Replies (9)

Please login or register to join the discussion.

RLI
By lionofludesch
31st Dec 2021 15:56

You're right to worry.

You need to buy each other's flats.

Thanks (1)
avatar
By Leywood
31st Dec 2021 16:04

Get another Accountant

Thanks (2)
Replying to Leywood:
avatar
By JD
31st Dec 2021 17:43

Or perhaps the time and chance to review the facts and provide a considered professional response - it's just as likely that the op was expecting an immediate response in the middle of SA and Christmas season, and started posting things, in this immediate social media world

Thanks (2)
avatar
By Truthsayer
31st Dec 2021 17:01

You should have asked your accountant before you swapped. If he cannot advise now, appoint someone who can.

Thanks (0)
avatar
By Paul Crowley
31st Dec 2021 17:41

This needs sorting
3 out of five years could lead to a liability

You make no mention of price movement

Was not a problem in the past. last 3 years ignored, then last 18 months, then last 9 months
Election could be problematic. You each had 2 years from change day. But even if you did it on time, the issue would be convincing HMRC that all parties were living in both properties at least some of the time.
I assume you did not mention to accountant 3 years ago. and phoned him in the Christmas to New year break

Thanks (0)
Replying to Paul Crowley:
RLI
By lionofludesch
31st Dec 2021 17:52

Paul Crowley wrote:

Election could be problematic. You each had 2 years from change day. But even if you did it on time, the issue would be convincing HMRC that all parties were living in both properties at least some of the time.

The Council Tax would seem to be a bit of a killer here. It's direct evidence that neither father and son are living in the properties they own. Neither gets PPR since the council tax change took effect.

Is a sale (to a third party) being contemplated in the near future ? What's the latent gain ? Why did you do something so daft ?

Thanks (0)
Replying to lionofludesch:
avatar
By Leywood
31st Dec 2021 18:02

DIYer, see profile history. Never seen the value of Accountants? Seems to have acquired Accountant only recently.

Nothing like tax planning is there!

I have one client who keeps doing really daft stuff before asking for advice, despite me banging his head against a wall every time I find out.

Thanks (2)
Replying to Leywood:
avatar
By Hugo Fair
31st Dec 2021 18:18

If he keeps doing it, then maybe he enjoys you banging his head against a wall?

Thanks (2)
Replying to Hugo Fair:
avatar
By bernard michael
01st Jan 2022 10:34

Hugo Fair wrote:

If he keeps doing it, then maybe he enjoys you banging his head against a wall?


Or he's damaged his head so much that he now takes a contrary review of all advice
Thanks (0)
Share this content